We have seen that the efficient level of pollution is the
one that minimises the sum of total abatement costs plus total damage costs.
Refer now to Figure 5.3. Show that if pollution abatement takes place to the
extent ! _ MA the sum of total damage costs and total abatement costs is
C1 + C2 + C3. Prove that too little
abatement (relative to the optimal quantity) results in higher costs than C1
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